In an ambitious move aimed at repositioning the Philippines as a more attractive destination for gaming operators, the Philippine Amusement and Gaming Corporation (Pagcor) has unveiled a plan to reduce the rates charged to operators effective April 1st. Alejandro Tengco, the chairman and CEO of Pagcor, announced the initiative on March 19th, signaling the regulator’s desire to align with global industry standards and encourage lawful gaming practices within the country.
The substantial rate decrease, averaging 5%, reduces the burden on operators from a previous remittance rate that exceeded 50% to an expected average of 35% of Gross Gaming Revenue (GGR). This decisive cut was spearheaded by Tengco upon his assumption of office in August 2022, and it represents a significant stride towards competitive parity with international markets.
“The remittance rates should then average around 35% of GGR, which is quite significant because when we assumed office in August 2022, the prevailing remittance rate was over 50%,” Tengco elucidated. “We have gradually lowered them so that by April 1, our rates will be at par with global industry standards.”
This strategic adjustment in rates is also seen as a deterrent to illegal gaming operations. Tengco believes that by offering more favorable terms, currently unlawful operators will be persuaded to regularize their activities and obtain licenses through Pagcor.
Looking at the broader horizon, Tengco outlined three growth pillars for the Filipino gaming market: the establishment and operation of more integrated casino resorts, consistent performance from the electronic games sector, and the anticipated benefits of Pagcor’s planned transition toward privatisation in 2025. This shift will see Pagcor evolve into a purely regulatory entity, relinquishing its casino operations to private entities. This decision was green-lit last September and had been under serious consideration by the corporation for over a year, further underlining Pagcor’s commitment to transforming and revitalizing the sector.
The privatization process is set to see a divestiture of Pagcor’s casino operational assets to a suitable private bidder, thus freeing the corporation to concentrate on regulatory excellence and reinvestment into expansion and technological innovation in the gaming industry. Pagcor’s future-focus was already palpable in their repudiation of disinformation related to the privatization, specifically countering false claims of a ₱500 million investment to refurbish its Casino Filipino branch in Angeles City to lure potential buyers post-privatization. The allegations, originating from a social media post by Pagcor employee Gian Samson, were firmly dismissed by Tengco.
“There is no truth in Mr Samson’s allegations because the said renovation will be borne by the lessor,” Tengco responded. The corporation confirmed its stance that it would not expend funds on the renovation, emphasizing that the building’s lessor would finance any refurbishment.
Further solidifying its modernization drive, in July 2023, Pagcor announced its entry into the online gaming space through the scheduled launch of Casinofilipino.com in the first quarter of 2024. This digital venture marks a crucial step in expanding Pagcor’s footprint and adapting to the rapidly evolving gaming landscape.
This series of strategic measures by Pagcor demonstrates a proactive approach to ensure both the vitality and integrity of the Philippines’ gaming industry. With reduced rates, scheduled privatization, and an embrace of online gaming, the future of this sector looks poised for a promising evolution under the guidance of Tengco and the regulatory body he leads. Players, investors, and political observers alike will watch closely as these plans unfold, potentially reshaping the country’s positioning within the global gaming marketplace.
